In Part One of this three part article I laid out the groundwork of how the Federal Reserve is responsible for the excessive level of debt in our society and how it has warped the thinking of the American people, while creating a tremendous level of mal-investment. In Part Two I focused on the Federal Reserve/Federal Government scheme to artificially boost the economy through the issuance of subprime debt to create a false auto boom. In this final episode, I’ll address the disastrous student loan debacle and the dreadful global implications of $200 trillion of debt destroying the lives of citizens around the world.

Getting a PhD in Subprime Debt

“When easy money stopped, buyers couldn’t sell. They couldn’t refinance. First sales slowed, then prices started falling and then the housing bubble burst. Housing prices crashed. We know the rest of the story. We are still mired in the consequences. Can someone please explain to me how what is happening in higher education is any different?This bubble is going to burst.” – Mark Cuban

Now we get to the subprimiest of subprime debt – student loans. Student loans are not officially classified as subprime debt, but let’s compare borrowers. A subprime borrower has a FICO score of 660 or below, has defaulted on previous obligations, and has limited ability to meet monthly living expenses. A student loan borrower doesn’t have a credit score because they have no credit, have no job with which to pay back the loan, and have no ability other than the loan proceeds to meet their monthly living expenses. And in today’s job environment, they are more likely to land a waiter job at TGI Fridays than a job in their major. These loans are nothing more than deep subprime loans made to young people who have little chance of every paying them off, with hundreds of billions in losses being borne by the ever shrinking number of working taxpaying Americans.

Student loan debt stood at $660 billion when Obama was sworn into office in 2009. The official reported default rate was 7.9%. Obama and his administration took complete control of the student loan market shortly after his inauguration. They have since handed out a staggering $500 billion of new loans (a 76% increase), and the official reported default rate has soared by 43% to 11.3%. Of course, the true default rate is much higher. The level of mal-investment and utter stupidity is astounding, even for the Federal government. Just some basic unequivocal facts can prove my case.

There were 1.67 million Class of 2014 students who took the SAT. Only 42.6% of those students met the minimum threshold of predicted success in college (a B minus average). That amounts to 711,000 high school seniors intellectually capable of succeeding in college. This level has been consistent for years. So over the last five years only 3.5 million high school seniors should have entered college based on their intellectual ability to succeed. Instead, undergraduate college enrollment stands at 19.5 million. Colleges in the U.S. are admitting approximately 4.5 million more students per year than are capable of earning a degree. This waste of time and money can be laid at the feet of the Federal government. Obama and his minions believe everyone deserves a college degree, even if they aren’t intellectually capable of earning it, because it’s only fair. No teenager left behind, without un-payable debt.

‘If you’re committed enough, you can make any story work. I once told a woman I was Kevin Costner, and it worked because I believed it’ – Saul Goodman – Breaking Bad

“As calamitous as the sub-prime blowup seems, it is only the beginning. The credit bubble spawned abuses throughout the system. Sub-prime lending just happened to be the most egregious of the lot, and thus the first to have the cockroaches scurrying out in plain view. The housing market will collapse. New-home construction will collapse. Consumer pocketbooks will be pinched. The consumer spending binge will be over. The U.S. economy will enter a recession.” – Eric Sprott – 2007

In Part One of this article I provided the background of how our current debt saturated economy got to this point of ludicrousness. The “crazy” bloggers, prophets of doom, and analysts who could do basic math were warning of an impending financial crisis in 2006 and 2007, which would be caused by the issuance of hundreds of billions in subprime slime by the Too Big To Trust Wall Street shysters. Subprime mortgages, auto loans, and credit card lines provided the kindling for the 2008 conflagration.

Under normal circumstances we wouldn’t have seen such irrational, reckless, greedy behavior from Wall Street for another generation. But, Wall Street didn’t have to accept the consequences of their actions. They were bailed out and further enriched by their puppets at the Federal Reserve, the lackey politicians they installed in Washington D.C., and on the backs of honest, hard-working, tax paying Americans. The lesson they learned was they could continue to take excessive, reckless, unregulated risks without concern for losses, downside, or consequences.

In reality, the Fed and government have worked in tandem with Wall Street to create the subprime economic recovery. The scheme has been to revive the bailed out auto industry by artificially boosting sales through dodgy, low interest, extended term debt. With the Feds taking over the entire student loan market, they have doled out hundreds of billions to kids who don’t have the educational skills to succeed in college, in order to keep them out of the unemployment calculation.

That’s why you have a 5.7% unemployment rate when 41% of the working age population (102 million people) is not working. The appearance of economic recovery has been much more important to the ruling class than an actual economic recovery for average Americans, because the .1% have made out like bandits anyway. Who has benefited from the $650 billion of student loan and auto debt disseminated by the oligarchs in the last four years, the borrowers or lenders?

“At this juncture, the impact on the broader economy and financial markets of the problems in the subprime market seems likely to be contained.” – Fed chairman, Ben Bernanke, Congressional testimony, March, 2007

“Capitalism without financial failure is not capitalism at all, but a kind of socialism for the rich.” – James Grant, Grant’s Interest Rate Observer

The Federal Reserve issued their fourth quarter Report on Household Debt and Credit last week to the sounds of silence in the mainstream media. There were minor press releases issued by the “professional” financial journalists regurgitating the Federal Reserve’s storyline. Actual analysis, connecting the dots, describing how the massive issuance of student loan and auto loan debt has produced a fake economic recovery, and how the accelerating default rates in auto loans and student loans will produce the next subprime debt implosion, were nowhere to be seen on CNBC, Bloomberg, the WSJ, or any other status quo propaganda media outlet. Their job is not to analyze or seek truth. Their job is to keep their government patrons and Wall Street advertisers happy, while keeping the masses sedated, misinformed, and pliable.

Luckily, the government hasn’t gained complete control over the internet yet, so dozens of truth telling blogs have done a phenomenal job zeroing in on the surge in defaults. The data in the report tells a multitude of tales conflicting with the “official story” sold to the public. The austerity storyline, economic recovery storyline, housing recovery storyline, and strong auto market storyline are all revealed to be fraudulent by the data in the report. Total household debt grew by $117 billion in the fourth quarter and $306 billion for the all of 2014. Non-housing debt in the 4th quarter of 2008, just as the last subprime debt created financial implosion began, was $2.71 trillion. After six years of supposed consumer austerity, total non-housing debt stands at a record $3.15 trillion. This is after hundreds of billions of the $2.71 trillion were written off and foisted upon the backs of taxpayers, by the Wall Street banks and their puppets at the Federal Reserve.

The corporate media talking heads cheer every increase in consumer debt as proof of economic recovery. In reality every increase in consumer debt is just another step towards another far worse economic breakdown. And the reason is simple. Real median household income is still below 1989 levels. The average American family hasn’t seen their income go up in 25 years. What they did see was their chains of debt get unbearably heavy. Non-housing consumer debt (credit card, auto, student loan, other) was $800 billion in 1989.

I’m sure my TBP empire will eventually get me on the list. I’m already on a bunch of other lists.

According to Forbes Magazine, the world’s top 20 billionaires have a combined net worth of $899 billion. Bill Gates comes first with a massive fortune of $79 billion. Even though he stepped down as Microsoft’s CEO in 2000, he has topped the rankings for 16 of the last 21 years.

When it comes to the world’s top 10 richest individuals, seven are American. The three exceptions are second placed Carlos Slim Helu and his family from Mexico, worth $77 billion, fourth placed Amancio Ortega of Spain who is worth $64.5 billion and tenth placed Liliane Bettencourt of France who has a wealth of $40 billion.

In a 2009 US policy paper published by the corporate-financier funded Brookings Institution, it was made clear that the US was determined to provoke Iran into a conflict and effect regime change at any cost – up to and including an outright military invasion and occupation of Iran with US troops.

However, before it came to that, the Brookings Institution’s policymakers explored other options including fomenting US-backed political unrest coupled with covert, violent force, the use of US State Department listed foreign terrorist organizations to carry out assassinations and attacks within Iran, and limited airstrikes carried out by either the US or Israel, or both.

In retropspect, 6 years on, all of these tricks have not only been attempted to one degree or another in Iran, but have been demonstrably employed in neighboring Syria to diminish its strength – which according to Brookings – is a necessary prerequisite before waging war on Iran.

And of particular interest – considering what appears to be a growing diplomatic row between the United States and Israel – is just how precisely the US planned to covertly back what would be made to appear as a “unilateral” Israeli first strike on Iran – an attack that appears to be in the process of being justified through a carefully orchestrated propaganda campaign now unfolding.

From the Mouths of US Policymakers Themselves

The Brookings Institution’s 2009 policy paper titled, “Which Path to Persia? Options for a New American Strategy Toward Iran,” makes clear that negotiations with Iran over its nuclear program is merely theater, and that it will be used to give the world the impression that the United States explored all possible “peaceful” options before resorting to violent regime change. The report states specifically that:

Denninger is far too nice in his assessment of the SSDI program. The Free Shit Army has jumped into this program with abandon. Once their two years of unemployment payments ran out, they suddenly developed mysterious ailments that keep them from working.

It’s amazing that over 60% of the people receiving SSDI have conditions that can be easily faked and not verified. Depression about having to get a job is considered a mental disorder, allowing the deadbeat to receive about $50,000 of benefits for doing nothing. That mysterious muscle ache which can’t be diagnosed will also do the job. Just watch the shyster lawyer commercials during the Jerry Springer Show to see how you are ENTITLED to SSDI.

The fact is this program was created for workers who got injured on the job and was supposed to be temporary until they could recover and go back to work. The workplace is 100 times safer than it was 25 or 50 years ago. Service jobs pushing paper or using computers or cash registers is not conducive to disability. Eating until you are 300 pounds will make you unemployable, but is no excuse for going on disability. Only 1% of the FSA that goes on SSDI ever goes back to work.

Workplace injuries account for less than 5% of all SSDI recipients. The billions being doled out to lazy good for nothing parasites has bankrupted the SSDI program. But don’t worry. They’ll just rob the equally bankrupt SSI program to keep paying these lazy fucks. Obama and his minions think this program is great, as it solidifies the Democratic base of non-working voters. Plus, these people don’t count in the unemployment rate calculation.

Sometime next year Social Security’s $150 billion disability-insurance program will become insolvent. The program, which offers income supplements to those who cannot work full time due to physical or mental disabilities, has buckled as the number of beneficiaries has soared to more than 11 million in 2014, from 3.8 million in 1984. The bipartisan Social Security Advisory Board has urged reforms.

These two charts tell you all you need to know about how disconnected Wall Street is from reality. Corporate profits are tanking. Consumer spending is tanking. Inflation in the things you need to live your everyday life is rising. Real median household income lingers at levels from 25 years ago. Greece, Portugal, Italy, Spain and Ireland are more insolvent than they were three years ago. The EU is disintegrating. Japan is committing economic hara-kiri. China’s trillions of real estate mal-investment is going bust. The OPEC countries, along with Russia, Brazil and Mexico are seeing their economies destroyed by low priced oil.

The US shale oil boom is going bust rapidly. Without the $500 billion of subprime auto and student loan debt injected into the veins of the American debt drug addicts, the economy would officially be in recession. Instead, recession is only a fact of life for the 99%. This cannot be sustained. So it won’t. At this point, we don’t even need a trigger event. The house of cards is so high, it will tumble just due to its sheer size. Look out below.

NATO has taken no decisions on sending British or any other instructors to Ukraine, Russia’s Ambassador to the North Atlantic Alliance Alexander Grushko said on Monday.

“NATO has taken no decisions on sending instructors,” he told the Rossiya 24 television channel. “NATO is implementing the decisions that were taken at the political level at the Wales summit in September 2014.”

Moscow will take all measures, including military-technical, to neutralize possible threat from NATO presence in Ukraine, he added.

Scanning the headlines in the western mainstream press, and then peering behind the one-way mirror to compare that to the actual goings-on, one can’t but get the impression that America’s propagandists, and all those who follow in their wake, are struggling with all their might to concoct rationales for military action of one sort or another, be it supplying weapons to the largely defunct Ukrainian military, or staging parades of US military hardware and troops in the almost completely Russian town of Narva, in Estonia, a few hundred meters away from the Russian border, or putting US “advisers” in harm’s way in parts of Iraq mostly controlled by Islamic militants.
The strenuous efforts to whip up Cold War-like hysteria in the face of an otherwise preoccupied and essentially passive Russia seems out of all proportion to the actual military threat Russia poses. (Yes, volunteers and ammo do filter into Ukraine across the Russian border, but that’s about it.) Further south, the efforts to topple the government of Syria by aiding and arming Islamist radicals seem to be backfiring nicely. But that’s the pattern, isn’t it? What US military involvement in recent memory hasn’t resulted in a fiasco? Maybe failure is not just an option, but more of a requirement?

Let’s review. Afghanistan, after the longest military campaign in US history, is being handed back to the Taliban. Iraq no longer exists as a sovereign nation, but has fractured into three pieces, one of them controlled by radical Islamists. Egypt has been democratically reformed into a military dictatorship. Libya is a defunct state in the middle of a civil war. The Ukraine will soon be in a similar state; it has been reduced to pauper status in record time—less than a year. A recent government overthrow has caused Yemen to stop being US-friendly. Closer to home, things are going so well in the US-dominated Central American countries of Guatemala, Honduras and El Salvador that they have produced a flood of refugees, all trying to get into the US in the hopes of finding any sort of sanctuary.

“A poor man is ever at a disadvantage in matters of public concern. When he rises to speak, or writes a letter to his superiors, they ask: ‘Who is this fellow that offers advice?’

And when it is known that he is without coin they spit their hands at him, and use his letters in the cooks’ fires. But if it be a man of wealth who would speak, or write, or denounce, even though he have the brain of a yearling dromedary, or a spine as crooked and unseemly, the whole city listens to his words and declares them wise.”

A controversial video named “I’m a Russian Occupant” has gone viral on the Internet and sparked a series of heated debates.

The video, which has subtitles in a number of languages including English, discusses Russia’s so-called historical “occupation” of Siberia, Baltic States, Ukraine and Central Asia in a satirical way, highlighting all the economic, social and political benefits that have came with it.

Right after “I’m a Russian Occupant” was published, Internet users from around the world started a heated debate about the meaning of the video.
“That’s it. I am defecting to Russia. Now I can have all the high quality radios and no longer have to clean my toilet because fascist house guests say it smells.” – wrote someone with a nickname “ThreeFontStreet”.

Another user contemplated: “Everyone lives on conquered land. History has just forgotten the conquered in some places. Is humanity better off having actual civilization in Siberia and the Americas? Probably.”

The video has already gathered more than 2 million views on YouTube. The author of the video is 45-year old Alexei Ivanov from the city of Nizhny Novgorod, who runs a group on VKontakte, Russia’s version of Facebook, where he posts his work.